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The idea that corporations bear a responsibility that stretches beyond their shareholders is not new. Many companies in the 19th century built special housing for their employees in the belief that a well-housed employee was more productive than one living in a dump. In the early years of the 20th century, Theodore Roosevelt, then president of the United States, said, “Corporations are indispensable instruments of our modern civilization; but I believe that they should be so supervised and so regulated that they shall act for the interests of the community as a whole.” He introduced antitrust legislation and rules on health and safety, and on working hours.
In 1987, Adrian Cadbury, head of the Eponymous chocolate firm, wrote in Harvard Business Review : the possibility that ethical and commercial considerations will conflict has always faced those who run companies. It is not a new problem. The difference now is that a more widespread and critical interest is being taken in our decisions and in the ethical judgments which lie behind them.
The debate then focused on how much of Roosevelt’s supervision and regulation was needed to make sure that corporations act sufficiently in the interests of the wider community. Extreme free-marketers say all that is required to ensure the responsible behavior of corporations is transparency about their affairs. Corporations will then behave responsibly towards the wider community without any coercion because it is in their own best interests. “Being good”, said Anita Roddick, founder of an “ethical” cosmetics firm, The Body Shop, “is good business.” In the United States, the Better Business Bureau goes further and argues that unethical business is bad for business as a whole, not just for individual firms.
The recent debate about corporate social responsibility (CSR) has focused on three main areas:
● The environment. This has stretched way beyond the simple demand that companies stop belching smoke out of factory chimneys to a demand that they control their appetite for natural resources—for bits of Brazilian rain forest, for example, or for the skins of rare animals. The organized hostility to such behavior has forced companies to change. For example, suppliers frightened by the venom of the anti-fur lobby felt compelled to boast: “Make no mistake; all our furs are fake.”
● Exploitation. The second strand is the exploitation of workers, especially of women in the developed world and of children in the developing world. There is a feeling that globalization has increased the power of multinationals to exploit the poor and underpaid, at the same time as it has weakened the influence of trade unions and other organizations designed to protect them.
● Bribery and corruption. The third strand focuses on corruption, in particular on the question of what constitutes a bribe (when does generous corporate hospitality step over the line?), and what protections should be given to whistleblowers (employees or other insiders who report corporate misdeeds). Here there is a strong cultural element to confuse the issue. What constitutes bribery in western countries, for example, may not be considered such in regions such as the Middle East.
1. What was Theodore Roosevelt’s view on corporate social responsibility (CSR)?
A) He thought that corporations should be able to fulfill CSR for their own interests.
B) He insisted that CSR meant all employees should be treated equally.
C) He believed that the fulfillment of CSR must rely on government.
D) He suspected that CSR would violate corporations’ own benefit.
2. Which of the following is NOT an aspect relevant to CSR?
A) Governmental regulation.
B) Ethics.
C) Transparency.
D) Community responsibility.
3. The expression “Being good” (Line 5, Paragraph 3) most probably means ______.
A) producing quality products
B) maintaining profitable business
C) being conscious of community
D) being socially accountable
4. The debate about CSR in the three main areas reveals that ______.
A) companies’ environmental protection measures should focus on factory chimneys
B) a better understanding of the best CSR practices requires a thorough comprehension of various cultures
C) globalization is by nature against the promotion of CSR
D) CSR makes it more difficult to bribe in a decent way
5. What can we infer from the text?
A) CSR is a recent concept, emerging from the 20th century.
B) Theodore Roosevelt was the first US president who was concerned with CSR.
C) CSR is not only beneficial to individual companies, but the entire business sphere.
D) Trade unions are equally powerful in developed and developing countries.